Amended in Assembly March 18, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2472


Introduced by Assembly Member Linder

February 19, 2016


An act tobegin delete amend Section 23400 of the Revenue and Taxation Code, relating to taxation.end deletebegin insert add and repeal Section 17059.50 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 2472, as amended, Linder. begin deleteCorporation Tax Law: alternative minimum tax. end deletebegin insertPersonal income taxes: credits: disabled veterans: service animals.end insert

begin insert

The Personal Income Tax Law allows various credits against the taxes imposed by that law.

end insert
begin insert

This bill, for taxable years beginning on or after January 1, 2017, and before January 1, 2022, would allow a credit under the Personal Income Tax Law in an amount equal to 50% of the amounts paid or incurred during the taxable year by a qualified disabled veteran for the ownership and maintenance of a qualified animal, not to exceed $2,000 for a taxable year.

end insert
begin insert

This act provides for a tax levy within the meaning of Article IV of the Constitution and shall go into immediate effect.

end insert
begin delete

Existing law, the Corporation Tax Law, in modified conformity with federal law, makes a corporation subject to the alternative minimum tax under specified circumtances. Existing law provides that a corporation electing to be treated as an “S corporation” is not subject to the alternative minimum tax.

end delete
begin delete

This bill would make a nonsubstantive change to that provision.

end delete

Vote: majority. Appropriation: no. Fiscal committee: begin deleteno end deletebegin insertyesend insert. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertThe Legislature finds and declares all of the
2following:end insert

begin insert

3(a) California is home to a large population of war veterans,
4comprised of service men and women who have honorably served
5in the line of duty.

end insert
begin insert

6(b) It is not uncommon for veterans, after experiencing the
7horrors of war, to suffer from physical or mental health challenges,
8or both.

end insert
begin insert

9(c) Common conditions war veterans are afflicted with include
10post-traumatic stress disorder, traumatic brain injury, and
11heightened anxiety.

end insert
begin insert

12(d) Trained animals are often used to assist disabled veterans
13in their rehabilitation. An animal can greatly contribute to the
14veteran’s sense of normalcy by providing support and
15companionship.

end insert
begin insert

16(e) The purpose of Section 17059.50 of the Revenue and
17Taxation Code, as proposed to be added by this act, is to create
18an income tax credit for disabled veterans, as determined by a
19disability rating promulgated by the United States Department of
20Veterans Affairs, who incur costs associated with ownership of a
21service dog.

end insert
22begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 17059.50 is added to the end insertbegin insertRevenue and Taxation
23Code
end insert
begin insert, to read:end insert

begin insert
24

begin insert17059.50.end insert  

(a) For each taxable year beginning on or after
25January 1, 2017, and before January 1, 2022, there shall be
26allowed a credit against the “net tax,” as defined by Section 17039,
27an amount equal to 50 percent of the qualified costs of a qualified
28disabled veteran, not to exceed two thousand dollars ($2,000) for
29a taxable year.

30(b) For the purposes of this section, the following definitions
31shall apply:

32(1) “Qualified animal” means a guide dog, signal dog, or
33service dog as defined in subparagraph (C) of paragraph (6) of
34subdivision (b) of Section 54.1 of the Civil Code.

P3    1(2) “Qualified costs” mean the amounts paid or incurred during
2the taxable year by a qualified disabled veteran for the ownership
3and maintenance of a qualified animal, including, but not limited
4to, the amount paid as local fees for animal licenses; veterinary
5care and medical-related expenses, such as vaccinations, annual
6check-ups, and drug prescriptions; pet insurance coverage
7expenses; expenses for speciality equipment, such as vests, leads,
8and harnesses; grooming expenses; and food expenses.

9(3) “Qualified disabled veteran” means an individual who meets
10both of the following conditions:

11(A) Has served on active duty with the Armed Forces of the
12United States and received an honorable discharge for all periods
13of active service.

14(B) Has a service-connected disability as determined by a
15disability rating promulgated by the United States Department of
16 Veterans Affairs and is assisted with that disability by a qualified
17animal.

18(c) In the case where the credit allowed by this section exceeds
19the “net tax” the excess may be carried over to reduce the “net
20tax,” in the following year, and succeeding years if necessary,
21until the credit is exhausted.

22(d) Section 41 does not apply to the credit allowed by this
23section.

24(e) This section shall remain in effect only until December 1,
252022, and as of that date is repealed.

end insert
26begin insert

begin insertSEC. 3.end insert  

end insert
begin insert

This act provides for a tax levy within the meaning of
27Article IV of the Constitution and shall go into immediate effect.

end insert
begin delete28

SECTION 1.  

Section 23400 of the Revenue and Taxation Code
29 is amended to read:

30

23400.  

(a) Part VI of Subchapter A of Chapter 1 of Subtitle
31A of the Internal Revenue Code, relating to alternative minimum
32tax, shall apply, except as otherwise provided.

33(b) A corporation that elects under Chapter 4.5 (commencing
34with Section 23800) to be treated as an “S corporation” shall not
35be subject to the tax imposed by this chapter.

end delete


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